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ARA US Hospitality Trust reports FY2023 DPS of 3.43 US cents, 12.3% higher y-o-y

Felicia Tan
Felicia Tan • 2 min read
ARA US Hospitality Trust reports FY2023 DPS of 3.43 US cents, 12.3% higher y-o-y
DPS for the 2HFY2023 rose by 18.6% y-o-y to 1.929 US cents. Photo: ARA US Hospitality Trust
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ARA US Hospitality Trust has reported a distribution per stapled security (DPS) of 3.43 US cents (4.6 cents) for the FY2023 ended Dec 31, 2023, 12.3% higher y-o-y. DPS for the 2HFY2023 rose by 18.6% y-o-y to 1.929 US cents.

FY2023 revenue rose by 3.8% y-o-y to US$175.5 million as portfolio occupancy rose by 4 percentage points y-o-y to 69.3%. Revenue per available room (RevPAR) improved by 12.9% y-o-y to US$96. The average daily rate (ADR) also rose by 5.3% y-o-y to US$138.

Gross operating profit for the year rose by 8.1% y-o-y to US$62.0 million while net property income (NPI) was up by 15.1% y-o-y to US$47.7 million. Both were higher from the increase in revenues.

Distributable income for the FY2023 was also up by 13.3% y-o-y to US$19.8 million after deducting nonoperating expenses and reserves set aside for routine capital asset improvements and refurbishments for the hotel properties and other adjustments.

2HFY2023 revenue rose by 2.0% y-o-y to US$89.5 million while gross operating profit grew by 5.3% y-o-y to US$31.3 million. 2HFY2023 NPI surged by 26.4% y-o-y to US$25.7 million as property taxes fell. 2HFY2023 distributable income was up by 18.9% y-o-y to US$11.2 million.

“Amidst the challenges posed by the impact of elevated interest rates, economic uncertainties, and geopolitical tensions, our well-diversified portfolio of upscale, select service hotels have continued to demonstrate resilience on the back of proactive portfolio management,” says Lee Jin Yong, CEO of the managers.

See also: OUE expected to record a loss for 1HFY2024 mainly due to estimated losses from 25.2%-owned investee company

“Riding on the tailwinds of the recovery of the US lodging sector, we are pleased to report that we have outperformed year-on-year across all key performance indicators in 2023 and continue to deliver healthy returns to all stapled securityholders. Since there is no immediate refinancing risk, we plan to focus on organic growth through hands-on asset management, portfolio optimization, and disciplined capital deployment,” he adds.

“The US lodging sector remains healthy and has outperformed expectations in 2023, augmented by resilient consumer spending. As our portfolio is orientated towards domestic leisure and business travellers, we will continue to benefit from the growth in RevPAR in the coming year. We are cautiously optimistic that macroeconomic headwinds, geopolitical risk, and broad cost pressures will be mitigated by our proactive, hands-on asset management approach to our portfolio,” he continues.

Unitholders will receive their distributions for the 2HFY2023 on March 28.

Units in ARA US Hospitality Trust XZL -

closed 0.5 cents higher or 1.89% up at 27 US cents on Feb 21.

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